Single item lot-sizing problem for a warm/cold process with immediate lost sales

Date
2008-06-16
Authors
Berk, E.
Toy, A. Ö.
Hazır, Ö.
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Supervisor
Co-Advisor
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Instructor
Source Title
European Journal of Operational Research
Print ISSN
0377-2217
Electronic ISSN
Publisher
Elsevier
Volume
187
Issue
3
Pages
1251 - 1267
Language
English
Type
Article
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Abstract

We consider the dynamic lot-sizing problem with finite capacity and possible lost sales for a process that could be kept warm at a unit variable cost for the next period t + 1 only if more than a threshold value Qt has been produced and would be cold, otherwise. Production with a cold process incurs a fixed positive setup cost, Kt and setup time, St, which may be positive. Setup costs and times for a warm process are negligible. We develop a dynamic programming formulation of the problem, establish theoretical results on the structure of the optimal production plan in the presence of zero and positive setup times with Wagner–Whitin-type cost structures. We also show that the solution to the dynamic lot-sizing problem with lost sales are generated from the full commitment production series improved via lost sales decisions in the presence of a warm/cold process. 2006 Elsevier B.V. All rights reserved.

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Keywords
Dynamic lot sizing, Warm/cold process, Lost sales, Setup times, Setup costs, Scheduling
Citation
Published Version (Please cite this version)